Minnesota Company’s H-2B Program Violations Result in Debarment and Fines

The U.S. Department of Labor’s Wage and Hour Division (WHD) has been increasing its compliance enforcement in the past couple of years. More and more companies file for agricultural and nonagricultural workers each year, due to the shortage of U.S. workers to fill these positions.

USCIS does not limit the number of agricultural worker visas (H-2A). It does limit the number of visas for other guest workers using the H-2B program. Companies use the H-2B for temporary, seasonal non-agricultural work like landscaping, snow removal, or resort/hotel work. The limit on the H-2B visa creates an increasing demand. USCIS runs a lottery, similar to the H-1B for professional workers.

The Valdes Case

Recently, the WHD found that a Minnesota lawn care and snow removal company violated the terms of the H-2B visa program. Although the company and the WHD settled the case, the company, Valdes Lawn Care and Snow Removal LLC in Lake Elmo (Valdes) lost its right to participate in the H-2B program for three years and will have to pay over $250,000 in fines, back wages, and other damages.

While this may sound harsh, one purpose of the having the DOL involved in these immigration applications, and other employment-based immigration applications is to protect jobs and wages of U.S. workers. The other is to protect vulnerable foreign workers who are dependent upon their employers for their legal immigration status.

Hiring Foreign Workers Through the H-2B Program

One of the first steps in filing an H-2 immigration application based on a temporary job offer, is to obtain a temporary labor certification (TLC) from the DOL. The labor certification ensures that employers are not paying lower wages to foreign workers who are more likely to accept these jobs at lower pay than an American worker. The employer also makes several attestations on the TLC regarding the wage rate, housing, guarantee of hours, transportation costs, the scope of work the H-2B will perform, and that it is telling the truth on the application.

After an employer receives the DOL’s approval, it can move ahead and file an immigration application with USCIS. Employers admittedly have a heavy burden to remain in compliance with the various federal, state, and local labor and employment laws. But employers of foreign workers have an even higher burden.

However, in this case, it would be hard to argue that the employer was merely uninformed. Additionally, if an employer has had past immigration violations in the H-2 or any other program, the consequences can be more severe.

Immigration law is a separate and complex animal. Employer compliance with labor and employment laws does not always mean compliance with immigration laws. In this case, it appears that the employer violated both. Valdes employed 70 H-2B workers, which adds up to a substantial amount of back-wages liability.

Immigration violations of the H-2B program

  • Failed to disclose that housing was available at a cost and then profited off workers by charging monthly rent fees that were higher than the cost to Valdes.
  • Demanded guest workers each pay them up to $800 as a condition of employment.
  • Failed to reimburse guest workers for travel expenses from and to their home countries, as required.
  • Failed to offer guest workers at least 35 hours per workweek during the first months of the work season as required.
  • Employed at least four temporary foreign workers hired for landscaping and snow removal work to perform construction work.
  • Misrepresented the need for workers; for a four-month period, the employer had little to no work available.
  • Failed to provide workers with a copy of the job order outlining the terms and conditions of employment.
  • Failed to post the mandatory Employee Rights Under the H-2B Program poster.

FLSA minimum wage and overtime requirements violations

  • Failed to pay overtime after 40 hours in a work week and instead paid overtime only after 80 hours worked in a two-week pay period.
  • Failed to pay guest workers overtime at the required rates.
  • Paid nine U.S. workers flat salaries regardless of the number of hours that they worked, failing to pay overtime when they worked more than 40 hours in a workweek.
  • Failed to keep records of the number of hours employees actually worked by salaried workers, and by H-2B workers who performed construction and laborer work at the employer’s home.

Bottom Line

Complying with regulations is a daunting task but employers must be diligent about it. Even if the DOL finds that the company has violated the H-2B program regulations, an employer’s good-faith efforts to comply can help to mitigate the damage.

In this case, most of the violations are not mere negligence or ignorance of the program requirements, especially failing to pay the minimum required wage, misrepresenting the employer’s workload, and using H-2B workers for work not permitted in the temporary labor certification.